You can host with anyone you want, just upload the files like normal. But you can go with Apple, I think it's with the "Mobile Me" thing they're doing. You get the nice integration with that. And it's not free, but it's really hassle free if you sign up for it. I've never looked into it much as it's not something I'd use.
All correct. To elaborate, though:
MobileMe give you 20 GB of web space. You split that between your MobileMe e-mail address, your web sites, and your "iDisk." That's a virtual hard drive that is loaded on your Mac as if it were a flash drive, except it's online. You can access it from any web browser on any computer. I can also look up my home address book and calendar from any web browser that's on the internet. I can also screen-share securely from my laptop to my desktop over the internet using MobileMe.
You can host an iWeb-made site on any server, but doing it on MobileMe's servers has one really cool advantage. Check out this site. Scroll through the photos by clicking on the next one. That animation is being done by Apple's servers. If I put that page on my own server I wouldn't get the animation. It's not flash, either, so it needs no plug-in. That's 1 of the 2 main reason I have MobileMe. That page is created automatically from photos I drop on it. It creates the different sizes and allows my family to see web versions there (and animated) but still download full sized copies (either a single photo or a zip file of the whole album which, again, was created automatically). It's fast, easy, and super useful.
The other main reason I have MobileMe is my iPhone. It's now a must-have for any iPhone user. It syncs all my Address Book, bookmarks, and Calendar info wirelessly between my phone and my 3 Macs. People are used to this with their work phones that use exchange, but it's still pretty rare to have this feature at home. I'm a big fan. Actually, it was darned useful before my iPhone. Having all 3 computers in sync is worth $100 a year. That used to be the only reason I paid for the service. Now there's more, but all the other stuff is just gravy.